[House Report 111-581]
[From the U.S. Government Publishing Office]
111th Congress Rept. 111-581
HOUSE OF REPRESENTATIVES
2d Session Part 1
======================================================================
BLOWOUT PREVENTION ACT OF 2010
_______
July 29, 2010.--Ordered to be printed
_______
Mr. Waxman, from the Committee on Energy and Commerce, submitted the
following
R E P O R T
The Committee on Energy and Commerce, to whom was referred
the bill (H.R. 5626) to protect public health and safety and
the environment by requiring the use of safe well control
technologies and practices for the drilling of high-risk oil
and gas wells in the United States, and for other purposes,
having considered the same, report favorably thereon with an
amendment and recommend that the bill as amended do pass.
CONTENTS
Page
Amendment........................................................ 1
Purpose and Summary.............................................. 13
Background and Need for Legislation.............................. 13
Legislative History.............................................. 17
Committee Consideration.......................................... 17
Committee Votes.................................................. 17
Committee Oversight Findings and Recommendations................. 19
New Budget Authority, Entitlement Authority, and Tax Expenditures 19
Statement of General Performance Goals and Objectives............ 19
Constitutional Authority Statement............................... 19
Earmarks and Tax and Tariff Benefits............................. 19
Federal Advisory Committee Statement............................. 19
Applicability of Law to Legislative Branch....................... 19
Federal Mandates Statement....................................... 19
Committee Cost Estimate.......................................... 20
Congressional Budget Office Cost Estimate........................ 20
Section-by-Section Analysis of the Legislation................... 20
Changes in Existing Law Made by the Bill, as Reported............ 26
Amendment
The amendment is as follows:
Strike all after the enacting clause and insert the
following:
SECTION 1. SHORT TITLE.
This Act may be cited as the ``Blowout Prevention Act of 2010''.
SEC. 2. NO DRILLING OF COVERED WELLS WITHOUT DEMONSTRATED ABILITY TO
PREVENT AND CONTAIN LEAKS.
(a) Federally Permitted Covered Wells.--Effective one year after the
date of enactment of this Act, the appropriate Federal official shall
not issue a permit to drill for a covered well unless the applicant for
such permit demonstrates, the Chief Executive Officer of the applicant
attests in writing, and the appropriate Federal official determines
that--
(1) the well design is safe;
(2) the blowout preventer has redundant systems to prevent or
stop a blowout for all foreseeable blowout scenarios and
failure modes;
(3) the applicant has an oil spill response plan that ensures
that the applicant has the capacity to promptly control and
stop a blowout in the event the blowout preventer and other
well control measures fail; and
(4) the applicant has the capability to begin drilling of a
relief well promptly, and complete such drilling of a relief
well to stop a blowout expeditiously.
(b) Other Covered Wells.--Effective one year after the date of
enactment of this Act, any operator who intends to drill a covered well
for which a permit to drill is not otherwise required to be issued by a
Federal official shall notify the appropriate Federal official of the
operator's intent to drill such covered well, and shall not commence
drilling such well without approval of the appropriate Federal
official. The appropriate Federal official shall approve the
commencement of drilling of such well only if the operator has made a
demonstration and attestation, and the appropriate Federal official has
made a determination, equivalent to those required under subsection
(a). The appropriate Federal official may delegate the duties
associated with this subsection to a State if the appropriate Federal
official determines that such State is capable of faithfully executing
such duties.
(c) Material Modifications.--A permit or approval for a covered well
issued under this section shall require the operator to seek a revision
of such permit or approval in the event of a material modification to
the well design, blowout preventer, plan to promptly stop a blowout, or
capability to begin or complete drilling of a relief well for such
covered well.
SEC. 3. BLOWOUT PREVENTER REQUIREMENTS.
(a) Blowout Preventer Adequacy Standards.--
(1) Standards.--The regulations issued under section 7(a)
shall require the use of blowout preventers in all covered well
drilling operations and prescribe safety standards for such
blowout preventers. Such standards shall require that a blowout
preventer will operate effectively at the location where it
will be deployed to prevent a blowout. At a minimum, such
standards shall include the following requirements:
(A) Two sets of blind shear rams appropriately spaced
to prevent blowout preventer failure if a drill pipe
joint or drill tool is across one set of blind shear
rams during a situation that threatens loss of well
control.
(B) Redundant emergency backup control systems
capable of activating the relevant components of a
blowout preventer, including when the communications
link or other critical links between the drilling rig
and the blowout preventer are destroyed or inoperable.
(C) Regular testing of the emergency backup control
systems, including testing during deployment of the
blowout preventer.
(D) As appropriate, ROV intervention capabilities for
secondary control of all blowout preventer functions,
including adequate hydraulic capacity to activate blind
shear rams, casing shear rams, and other critical
blowout preventer components.
(2) Advisory committee recommendations.--In accordance with
section 6 of this Act, the appropriate Federal official shall
request that the Advisory Committee provide the appropriate
Federal official with each of the following:
(A) A recommendation as to whether requiring up to
two sets of appropriately-spaced casing shear rams in
blowout preventers for all covered wells, or at certain
classes of covered wells, would significantly improve
the safety of blowout preventer systems at such wells.
(B) An evaluation of the risks associated with the
failure of hydraulic and activation systems for the
blind shear rams and other critical components of
blowout preventers at covered wells and, as
appropriate, a recommendation on how to best achieve an
appropriate level of redundancy to address such risks.
(C) An evaluation of the risks associated with
blowout preventers other than subsea blowout preventers
at offshore covered wells in the event the drilling rig
for such covered well is damaged or destroyed, the
riser or other well component between the wellbore and
the blowout preventer is damaged or destroyed, or the
blowout preventer at such covered well is rendered
inoperative, by a blowout, explosion, or other cause,
and, as appropriate, a recommendation on how to best
mitigate such risks.
If, based on any recommendation of the Advisory Committee under
this paragraph, the appropriate Federal official determines
that safety would be significantly improved by requiring
additional measures to mitigate risks identified under this
paragraph, the appropriate Federal official shall include such
a requirement in regulations issued under section 7(a). Nothing
in this paragraph shall prevent the appropriate Federal
official from adopting any requirement relating to the issues
addressed under this paragraph prior to the submission by the
Advisory Committee of an evaluation or recommendation under
this paragraph.
(3) Regulatory flexibility.--If, after notice and an
opportunity for public comment, the appropriate Federal
official determines that a minimum requirement prescribed under
this section would be less effective than an available
alternative technology or practice in preventing a blowout at
all covered wells, or at one or more classes of covered wells,
the appropriate Federal official may include in initial or
revised regulations issued under section 7(a) a requirement for
such alternative technology or practice at all covered wells,
or at such class or classes of covered wells, as appropriate,
in lieu of the less effective requirement.
(b) Independent Third-party Certification of Blowout Preventer
Readiness.--The regulations issued under section 7(a) shall require the
following:
(1) Prior to the commencement of drilling through a blowout
preventer at any covered well, the operator shall obtain a
written and signed certification from an independent third
party approved and assigned by the appropriate Federal official
pursuant to section 6(b) that the third party--
(A) conducted or oversaw a detailed physical
inspection, design review, system integration test, and
function and pressure testing of the blowout preventer;
and
(B) in the third-party certifier's best professional
judgment, determined that--
(i) the blowout preventer is designed for the
specific drilling conditions, equipment, and
location where it will be installed and for the
specific well design;
(ii) the blowout preventer and all of its
components and control systems will operate
effectively and as designed when installed;
(iii) each blind shear ram or casing shear
ram will function effectively under likely
emergency scenarios and is capable of shearing
the drill pipe or casing, as applicable, that
will be used when installed;
(iv) emergency control systems will function
under the conditions in which they will be
installed; and
(v) the blowout preventer has not been
compromised or damaged from any previous
service.
(2) Not less than once every 180 days after commencement of
drilling through a blowout preventer at any covered well, or
upon implementation of any material modification to the blowout
preventer or well design at such a well, the operator shall
obtain a written and signed recertification from an independent
third party approved and assigned by the appropriate Federal
official pursuant to section 6(b) that the requirements in
subparagraph (B) of paragraph (1) continue to be met with the
systems as deployed. Such recertification determinations shall
consider the results of tests required by the appropriate
Federal official, including testing of the emergency control
systems of a blowout preventer.
(3) Certifications under paragraph (1), recertifications
under paragraph (2), and results of and data from all tests
conducted pursuant to this subsection shall be promptly
submitted to the appropriate Federal official and made publicly
available.
(c) Additional Blowout Preventer Testing.--The regulations issued
under section 7(a) shall require, after a significant well control
event at a covered well, prompt function and pressure testing of any
blowout preventer component used in such well control event to ensure
the full operability of all functions of such component. The results of
and data from such testing shall be promptly submitted to the
appropriate Federal official.
(d) Documentation and Reporting.--The regulations issued under
section 7(a) shall require--
(1) submission to the appropriate Federal official of
documentation of blowout preventer maintenance and repair
within 24 hours of such maintenance and repair;
(2) prompt and real-time transmission of the electronic log
from a blowout preventer control system to a secure location
where it shall be continuously monitored and available for
inspection by the appropriate Federal official;
(3) maintenance, at a secure location off the drilling site,
of up-to-date design specifications of any blowout preventer in
service;
(4) submission to the appropriate Federal official of any
changes to the design specifications of a blowout preventer in
service within 24 hours of such change; and
(5) prompt reporting to the appropriate Federal official of a
failure of any blowout preventer or any component of a blowout
preventer when used during a well control event.
SEC. 4. ENSURING SAFE WELLS AND CEMENTING.
(a) Ensuring Safe Well Design.--The regulations issued under section
7(a) shall require the appropriate and safe design of covered wells. At
a minimum, such regulations shall require--
(1) in connection with the installation of the final casing
string, the installation of at least two independent, tested
mechanical barriers, in addition to a cement barrier, across
each flow path between hydrocarbon bearing formations and the
blowout preventer;
(2) that wells shall be designed so that a failure of one
barrier does not significantly increase the likelihood of
another barrier's failure;
(3) that the casing design is appropriate for the purpose for
which it is intended under reasonably expected wellbore
conditions; and
(4) the installation and verification with a pressure test of
a lockdown device at the time the casing is installed in the
wellhead.
(b) Ensuring Safe Cementing.--The regulations issued under section
7(a) shall require cementing programs and procedures for a covered well
to ensure that well control will be maintained and that there will be
no unintended flow path between any hydrocarbon-bearing formation zone
and the wellhead. Such regulations shall, at a minimum, require--
(1) adequate centralization of the casing to ensure proper
distribution of cement;
(2) a full circulation of drilling fluids prior to cementing;
(3) the use of an adequate volume of cement to prevent any
unintended flow of hydrocarbons between any hydrocarbon-bearing
formation zone and the wellhead;
(4) cement bond logs for all cementing jobs intended to
provide a barrier to hydrocarbon flow; and
(5) cement bond logs or such other integrity tests as the
appropriate Federal official may prescribe for cement jobs
other than those identified in paragraph (4).
(c) Ensuring Safe Decisionmaking.--The regulations issued under
section 7(a) shall require the well operator to maintain a team of
experienced and highly qualified engineers and other appropriate
experts to advise the operator on the safety of decisions made during
the drilling of the well that create a risk of loss of well control.
(d) Preventing Ignition and Explosion.--The regulations issued under
section 7(a) shall establish procedures and technologies to be used
during drilling at any covered well to minimize the risk of ignition
and explosion of hydrocarbons or any other material discharged from the
well during a blowout or well control event. Such regulations shall
address the diversion of oil, gas, well fluids, and other materials and
shall include standards for drilling equipment and engines on such
equipment.
(e) Regulatory Flexibility.--If, after notice and an opportunity for
public comment, the appropriate Federal official determines that a
minimum requirement prescribed under this section would be less
effective than an available alternative technology or practice in
preventing a blowout at all covered wells, or at one or more classes of
covered wells, in a situation that threatens loss of well control, the
appropriate Federal official may include in initial or revised
regulations issued under section 7(a) a requirement for such
alternative technology or practice at all covered wells, or at such
class or classes of covered wells, as appropriate, in lieu of the less
effective requirement.
(f) Third-party Certification.--
(1) Certification.--The regulations issued under section 7(a)
shall require that, prior to the commencement of drilling at
any covered well, the operator shall obtain a written and
signed certification from an independent third party approved
and assigned by the appropriate Federal official pursuant to
section 6(b) that the well meets the requirements established
by the appropriate Federal official under this section and,
that, in the best professional judgment of the independent
third party, the operator's well casing designs and cementing
programs and procedures ensure that well control will be
maintained and that there will be no unintended flow path
between hydrocarbon-bearing formation zones or between any
hydrocarbon-bearing zones and the wellhead.
(2) Recertification.--Upon implementation of any material
modification to the well design of such a well, the operator
shall obtain a written and signed recertification from an
independent third party approved and assigned by the
appropriate Federal official pursuant to section 6(b) that the
well design continues to meet the requirements established by
the appropriate Federal official under this section.
SEC. 5. STOP-WORK REQUIREMENTS.
(a) Requirements.--The regulations issued under section 7(a) shall
establish stop-work requirements for oil and gas exploration and
production activities at covered wells, including requirements that--
(1) the operator, or the operator's employees or contractors,
immediately stop all work at the covered well, other than the
work required to ensure safety, in the event of specified well
conditions or other factors indicating that there is an
immediate risk of a blowout;
(2) the operator adopt policies and procedures to promote a
safety culture and ensure that the operator, or the operator's
employees or contractors, immediately stop all work at the
covered well, other than the work required to ensure safety,
when the operator, or the operator's employees or contractors,
whether on the drilling site or off the drilling site, have
identified well conditions, well design, drilling procedures,
drilling equipment, or any other factor indicating that there
is an immediate risk of a blowout;
(3) the operator, or the operator's employees or contractors,
take appropriate action to mitigate risks identified pursuant
to paragraph (1) or (2), and obtain the concurrence of the
appropriate Federal official that such action is sufficient,
prior to resumption of work;
(4) the appropriate Federal official act in a timely manner
to provide the concurrence identified in paragraph (3) or to
identify further actions by the operator necessary to obtain
such concurrence; and
(5) the operator inform its employees and contractors that it
is illegal to retaliate against such employee or contractor for
raising safety concerns, including in connection with stop work
policies and procedures adopted pursuant to this section.
(b) Records of Events.--The appropriate Federal official shall
maintain records of all such events, their duration, the reason for
such events, and the actions taken prior to the resumption of
activities.
SEC. 6. INDEPENDENT TECHNICAL ADVICE AND CERTIFICATION.
(a) Well Control Technical Advisory Committee.--
(1) Establishment.--Not later than 60 days after the date of
enactment of this Act, the appropriate Federal official shall
appoint an independent technical advisory committee to be known
as the Well Control Technical Advisory Committee.
(2) Membership.--
(A) Composition.--The Advisory Committee shall be
composed of 7 members. Members shall be qualified by
education, training, and experience to provide
scientific and technical advice with regard to blowout
preventers and other well control equipment and
operations. The membership of the Advisory Committee
shall be balanced fairly in terms of the points of view
represented. At least 3 of the members of the Advisory
Committee shall be members of the National Academy of
Engineering. No more than 3 of the members of the
Advisory Committee shall be current employees of
entities subject to regulation under this Act or of
entities that are contractors of any entity subject to
regulation under this Act.
(B) Appointment and terms.--The appropriate Federal
official shall appoint Advisory Committee members,
including a chair and vice-chair to the Advisory
Committee. Each term of a member's service on the
Advisory Committee shall be 3 years, except for initial
terms, which may be up to 5 years in length to allow
staggering. Members may be reappointed only once for an
additional 3-year term.
(C) No pay; receipt of travel expenses.--Members of
the Advisory Committee shall not receive any pay for
service on the Advisory Committee but may receive
travel expenses, including a per diem, from the
appropriate Federal official.
(D) Staff and facilities.--The appropriate Federal
official shall make available to the Advisory Committee
such staff and facilities as the chair of the Advisory
Committee and the appropriate Federal official
determine are necessary to carry out the duties of the
Advisory Committee.
(3) Periodic reports.--Not later than 180 days after the date
of enactment of this Act, and every 5 years thereafter, the
Advisory Committee shall submit to the appropriate Federal
official and Congress a report that--
(A) assesses available blowout preventer and well
control technologies, practices, voluntary standards,
and regulations in the United States and elsewhere;
(B) assesses whether existing regulations issued by
the appropriate Federal official for blowout preventers
and well control for covered wells for oil and gas
exploration or production in the United States
adequately protect public health and safety and the
environment; and
(C) as appropriate, recommends modifications to the
regulations identified under subparagraph (B) to ensure
adequate protection of public health and safety and the
environment.
(4) Implementation assessment reports.--Not later than March
31 of 2012, and as needed thereafter, but not less frequently
than every two calendar years thereafter, the Advisory
Committee shall submit to the appropriate Federal official and
to Congress a report that--
(A) assesses the appropriate Federal official's
implementation of the requirements of this Act during
the preceding year, including well-specific regulatory
determinations and oversight, administration of
inspections, and third-party certification
requirements;
(B) recommends any improvements to the implementation
referred to in subparagraph (A) that, in the Advisory
Committee's judgment, would enhance the safety of
drilling operations subject to the requirements of this
Act; and
(C) reviews the safety record during the preceding
year of any equipment, designs, or practices subject to
the requirements of this Act.
(5) Other duties.--In addition to the responsibilities set
forth under this section, the Advisory Committee shall--
(A) review and comment on proposed regulations as
required under section 7;
(B) respond to requests for advice from the
appropriate Federal official on matters within the
Advisory Committee's expertise; and
(C) as appropriate, consult with third-party
certifiers and with employees of the agency conducting
inspections pursuant to this Act, and review reports or
other documents submitted to the appropriate Federal
official pursuant to this Act, to obtain information on
blowout preventer and well control safety issues.
(6) Application of federal advisory committee act.--The
Federal Advisory Committee Act (other than section 14 of such
Act) shall apply to the Advisory Committee to the extent that
the provisions of such Act do not conflict with the
requirements of this subsection.
(b) Independent Third-party Certifiers.--
(1) Approval.--The appropriate Federal official shall
establish appropriate standards for the approval of independent
third parties capable of exercising the certification functions
prescribed under sections 3 and 4, including standards to
ensure technical competence and an absence of, or a mechanism
for adequately mitigating, any actual or apparent conflicts of
interest.
(2) Assignment.--The appropriate Federal official shall
require that the reviews, inspections, tests, certifications,
and recertifications required under sections 3 and 4 are
performed or overseen by independent third-party certifiers
that have contracted directly with the appropriate Federal
official rather than the operator and are assigned by the
appropriate Federal official to individual certifications and
recertifications, including the reviews, inspections, and tests
required for such individual certifications and
recertifications. The appropriate Federal official shall ensure
that--
(A) a third-party certifier is appropriately
qualified for each certification or recertification to
which it is assigned; and
(B) such reviews, inspections, and tests are timely
performed.
(3) Contracting and fees.--The appropriate Federal official
shall contract with independent third-party certifiers to
perform the reviews, inspections, tests, certifications, and
recertifications required by the regulations issued under this
Act and shall assess fees upon operators to cover the
reasonable costs of such activities.
(4) Enforcement.--It shall be a violation of this Act for any
third-party certifier approved under this section to make any
false statement, knowingly or with reckless disregard for the
truth of such statement, in any document submitted to the
appropriate Federal official in connection with a certification
or recertification under this Act.
(c) Expert Review Panels.--The appropriate Federal official may
establish a panel of technical experts to provide technical advice with
regard to any well-specific regulatory decision under this Act,
including permitting determinations under section 2 and agency actions
described in section 4. The appropriate Federal official shall--
(1) identify a pool of qualified experts in relevant areas,
including but not limited to those drawn from academia,
national laboratories, and industry, for this purpose; and
(2) establish standards for including and maintaining
individuals in such pool, including standards to ensure
technical competence and an absence of, or a mechanism for
adequately mitigating, any actual or apparent conflicts of
interest.
SEC. 7. REGULATIONS AND ORDERS.
(a) Issuance, Review, and Revision of Regulations.--
(1) Issuance of regulations.--Not later than 1 year after the
date of enactment of this Act, the appropriate Federal official
shall issue the regulations required under this Act.
(2) Periodic review and revision of rules.--At least once
every 5 years, the appropriate Federal official shall review
and, based on new or updated information and taking into
consideration the recommendations of the Advisory Committee,
shall--
(A) revise the regulations issued under this Act to
ensure that such regulations adequately protect public
health and safety and the environment; or
(B) issue a written determination that revision of
such regulations would not materially enhance
protection of public health and safety or the
environment.
(3) Advisory committee review.--Upon issuance of any proposed
regulation under this Act, the appropriate Federal official
shall promptly submit such proposed regulation to the Advisory
Committee for its review. The Advisory Committee shall, within
90 days, submit comments advising the appropriate Federal
official whether the proposed regulation ensures adequate
protection of public health and safety and the environment and,
if not, proposing modifications to ensure such adequate
protection. Before issuance of a final regulation under this
Act, the appropriate Federal official shall consider and
respond in writing to comments and proposed modification
submitted by the Advisory Committee. If the appropriate Federal
official declines to adopt such proposed modifications, the
appropriate Federal official shall clearly and specifically
state the reasons for such decision in the final regulation.
(4) Rulemaking dockets.--
(A) Establishment.--Not later than the date of
proposal of any regulation under this Act, the
appropriate Federal official shall establish a publicly
available rulemaking docket for such regulation.
(B) Documents included.--Promptly upon receipt by the
appropriate Federal official, all written comments and
documentary information on the proposed rule received
from any person for inclusion in the docket during the
comment period shall be placed in the docket. The
transcript of public hearings, if any, on the proposed
rule shall also be included in the docket promptly upon
receipt from the person who transcribed such hearings.
All documents which become available after the proposed
rule has been published and which the appropriate
Federal official determines are of central relevance to
the rulemaking shall be placed in the docket as soon as
possible after their availability.
(C) Documents submitted to the office of management
and budget.--The drafts of proposed rules submitted by
the appropriate Federal official to the Office of
Management and Budget for any interagency review
process prior to proposal of any such rule, all
documents accompanying such drafts, and all written
comments thereon by other agencies and all written
responses to such written comments by the appropriate
Federal official shall be placed in the docket no later
than the date of proposal of the rule. The drafts of
the final rule submitted for such review process prior
to issuance and all such written comments thereon, all
documents accompanying such drafts, and written
responses thereto shall be placed in the docket no
later than the date of issuance.
(b) Interim Orders.--Prior to the issuance and effective date of
initial regulations required pursuant to subsection (a)(1), the
appropriate Federal official may issue an order applicable to one or
more operators to ensure that such operator or operators--
(1) have the capacity to prevent and respond to a blowout;
(2) utilize safe and effective blowout preventers;
(3) use safe casing designs and cementing programs and
procedures;
(4) use appropriate and safe designs of wells;
(5) use appropriate procedures and technologies to minimize
the risk of ignition or explosion of hydrocarbons or any other
material discharged from the well during a blowout or well
control event; and
(6) take any other appropriate measure to maintain well
control and prevent blowouts.
SEC. 8. WELL CONTROL AND BLOWOUT PREVENTION INSPECTORS.
The appropriate Federal official shall provide for periodic
unannounced inspections by agency inspectors of drilling operations of
covered wells to ensure that such operations comply with the
regulations issued pursuant to this Act. The appropriate Federal
official shall also provide for periodic in-person observation by
agency inspectors of tests undertaken for recertification under section
3. The appropriate Federal official may conduct inspections under this
section at any time. The appropriate Federal official shall charge and
collect fees from operators in amounts the appropriate Federal official
determines are sufficient to cover reasonable costs of inspections
under this section.
SEC. 9. JUDICIAL REVIEW OF REGULATIONS.
Any person aggrieved by any regulation issued by the appropriate
Federal official under this Act may seek judicial review of such
regulation exclusively in the United States Court of Appeals for the
District of Columbia Circuit. Any petition for review under this
section shall be filed within 60 days from the date notice of the
issuance of such regulation appears in the Federal Register, except
that if such petition is based solely on grounds arising after such
sixtieth day, then any such petition for review shall be filed within
60 days after such grounds arise.
SEC. 10. INVESTIGATIONS AND INFORMATION REQUESTS.
(a) Investigations.--The appropriate Federal official is authorized
to conduct investigations of violations or alleged or suspected
violations of this Act or of any regulation or order issued under this
Act. In any investigation conducted under this section, the appropriate
Federal official shall have the authority to summon witnesses and to
require the production of books, papers, documents, and any other
evidence. Attendance of witnesses or the production of books, papers,
documents, or any other evidence shall be compelled by a similar
process as in the district courts of the United States.
(b) Information Requests.--The appropriate Federal official may
require an operator or third-party certifier, or an employee or
contractor thereof, to provide, on a one-time, periodic, or continuous
basis, such information as the appropriate Federal official may
reasonably require for the purpose of--
(1) making any permitting or other regulatory determination,
issuing any order, or developing any regulation under this Act;
(2) determining whether any person is in violation of this
Act or of any regulation or order issued under this Act; or
(3) carrying out any other provision of this Act.
SEC. 11. CITIZEN SUITS.
(a) In General.--Any person having a valid legal interest which is or
may be adversely affected may commence a civil action in a Federal
district court of appropriate jurisdiction on such person's own behalf
to compel compliance with this Act, or any regulation or order issued
under this Act, against any person, including the United States, and
any other government instrumentality or agency (to the extent permitted
by the eleventh amendment to the Constitution) for any alleged
violation of any provision of this Act or any regulation or order
issued under this Act.
(b) Notice.--
(1) In general.--Except as provided in paragraph (2), no
action may be commenced under subsection (a)--
(A) prior to 60 days after the plaintiff has given
notice of the alleged violation, in writing under oath,
to the appropriate Federal official, to the State in
which the violation allegedly occurred or is occurring,
and to any alleged violator; or
(B) if the Attorney General of the United States has
commenced and is diligently prosecuting a civil action
in a court of the United States or a State with respect
to such matter, but in any such action in a court of
the United States any person having a legal interest
which is or may be adversely affected may intervene as
a matter of right.
(2) Exception.--An action may be brought under this
subsection immediately after notification of the alleged
violation in any case in which the alleged violation
constitutes an imminent threat to the public health or safety
or the environment or would immediately affect a legal interest
of the plaintiff.
(c) Intervention.--In any action commenced pursuant to this section,
the Attorney General of the United States, upon the request of the
appropriate Federal official, may intervene as a matter of right.
(d) Costs; Security.--A court, in issuing any final order in any
action brought pursuant to this section, may award costs of litigation,
including reasonable attorney and expert witness fees, to any party,
whenever such court determines such award is appropriate. The court
may, if a temporary restraining order or preliminary injunction is
sought, require the filing of a bond or equivalent security in a
sufficient amount to compensate for any loss or damage suffered, in
accordance with the Federal Rules of Civil Procedure.
(e) Savings.--Nothing in this section shall restrict any right which
any person or class of persons may have under any other Federal or
State law or common law to seek appropriate relief.
SEC. 12. REMEDIES AND PENALTIES.
(a) Injunctions and Restraining Orders.--At the request of the
appropriate Federal official, the Attorney General of the United States
or a United States attorney shall institute a civil action in the
district court of the United States for the district in which the
affected operation is located for a temporary restraining order,
injunction, or other appropriate remedy to enforce any provision of
this Act or any regulation, order, approval under section 2(b), or
permit issued under this Act.
(b) Civil Penalties; Hearing.--
(1) In general.--Except as provided in paragraph (2), if any
person fails to comply with any provision of this Act or any
regulation, order, approval under section 2(b), or permit
issued under this Act, after notice of such failure and
expiration of any reasonable period allowed for corrective
action, such person shall be liable for a civil penalty of not
more than $75,000 for each day of the continuance of such
failure. The appropriate Federal official may assess, collect,
and compromise any such penalty. No penalty shall be assessed
until the person charged with a violation has been given an
opportunity for a hearing. The appropriate Federal official
shall, by regulation at least every 3 years, adjust the penalty
specified in this paragraph to reflect any increases in the
Consumer Price Index for all urban consumers.
(2) Threat of serious irreparable or immediate harm.--If a
failure described in paragraph (1) constitutes or constituted a
threat of serious, irreparable, or immediate harm or damage to
life (including fish and other aquatic life), property, any
mineral deposit, or the marine, coastal, or human environment,
a civil penalty of not more than $150,000 shall be assessed for
each day of the continuance of the failure.
(c) Criminal Penalties.--Any person who knowingly and willfully--
(1) violates any provision of this Act, or any regulation,
order, approval under section 2(b), or permit issued under the
authority of this Act, designed to protect the public health
and safety or the environment;
(2) makes any false statement, representation, or
certification in any application, record, report, or other
document filed or required to be maintained under this Act; or
(3) falsifies, tampers with, or renders inaccurate any
monitoring device or method of record required to be maintained
under this Act,
shall, upon conviction, be punished by a fine of not more than
$10,000,000, or by imprisonment for not more than 10 years, or both.
Each day that a violation of paragraph (1) continues, or each day that
any monitoring device or data recorder remains inoperative or
inaccurate because of any activity described in paragraph (3), shall
constitute a separate violation.
(d) Liability of Corporate Officers and Agents for Violations by
Corporation.--Whenever a corporation or other entity is subject to
prosecution under subsection (c), any officer or agent of such
corporation or entity who knowingly and willfully, or with willful
disregard, authorized, ordered, or carried out the proscribed activity
shall be subject to the same fines or imprisonment, or both, as
provided for under subsection (c).
(e) Concurrent and Cumulative Nature of Penalties.--The remedies and
penalties prescribed in this Act shall be concurrent and cumulative and
the exercise of one shall not preclude the exercise of the others.
Further, the remedies and penalties prescribed in this Act shall be in
addition to any other remedies and penalties afforded by any other law
or regulation.
SEC. 13. RETALIATION PROHIBITED.
(a) Prohibition.--No person or employer may discharge any employee or
otherwise discriminate against any employee with respect to the
employee's compensation, terms, conditions, or other privileges of
employment because the employee (or any person acting pursuant to a
request of the employee)--
(1) notified the appropriate Federal official, a Federal or
State law enforcement or regulatory agency, or the employee's
employer of an alleged violation of this Act, or any
regulation, order, section 2(b) approval, or permit under this
Act, including notification of such an alleged violation
through communications related to carrying out the employee's
job duties;
(2) refused to participate in any conduct that the employee
reasonably believes is in noncompliance with a requirement of
this Act, or any regulation, order, section 2(b) approval, or
permit under this Act, if the employee has identified the
alleged noncompliance to the employer;
(3) testified before or otherwise provided information
relevant for Congress or for any Federal or State proceeding
regarding any provision (or proposed provision) of this Act;
(4) commenced, caused to be commenced, or is about to
commence or cause to be commenced a proceeding under this Act;
(5) testified or is about to testify in any such proceeding;
or
(6) assisted or participated or is about to assist or
participate in any manner in such a proceeding or in any other
action to carry out the purposes of this Act.
(b) Enforcement Action.--Any employee covered by this section who
alleges discrimination by an employer in violation of subsection (a)
may bring an action governed by the rules and procedures, legal burdens
of proof, and remedies applicable under subsections (d) through (h) of
section 20109 of title 49, United States Code. A party may seek
district court review as set forth in subsection (d)(3) of such section
not later than 90 days after receiving a written final determination by
the Secretary of Labor.
SEC. 14. CHEMICAL SAFETY BOARD INVESTIGATION.
Section 112(r)(6) of the Clean Air Act (42 U.S.C. 7412(r)(6)) is
amended by adding at the end the following:
``(T) Agreement.--Not later than 30 days after the
date of enactment of this subparagraph, the Chemical
Safety and Hazard Investigation Board, the Coast Guard,
and the Department of the Interior shall enter into an
agreement in order to facilitate the Board's
investigation of the facts, circumstances, and causes
of an accidental fire, explosion, or release involving
an offshore oil or gas exploration or production
facility (regardless of whether there is a resulting
marine oil spill). Such agreement shall provide the
Board with the following:
``(i) Unrestricted access to any personnel,
records, witness statements, recorded witness
interviews, and physical or documentary
evidence related to an offshore oil or gas
exploration or production facility under
investigation collected or possessed by the
Coast Guard or the Department of the Interior.
``(ii) The ability to conduct recorded
interviews of all agency personnel and
contractors and the right to obtain records
related to Federal regulatory, inspection,
enforcement, and safety programs for offshore
oil or gas exploration and production.
``(iii) The right to participate equally in
planning and executing any testing of relevant
items of physical evidence related to the cause
of the accident.
``(iv) Such support and facilities as may be
necessary for the Board's investigation,
including transportation to the accident site,
coastal waters and affected areas, and other
offshore oil or gas exploration and production
facilities without cost to the Board.
``(U) Recommendations.--Based on an investigation of
an accidental fire, explosion, or release involving an
offshore oil or gas exploration or production facility,
the Board shall make recommendations with respect to
preventing subsequent accidental fires, explosions, or
releases to the Secretary of the Interior and the
Commandant of the Coast Guard. The Secretary of the
Interior and the Commandant of the Coast Guard shall
respond formally and in writing to any recommendation
of the Board within 90 days of the receipt of such
recommendations.''.
SEC. 15. STATE AND FEDERAL REGULATION.
(a) State Plans.--Any State may submit to the appropriate Federal
official a plan demonstrating that the State's regulatory regime meets
the applicable standard under subsection (b) for effective regulation
of oil or gas exploration or production wells located in such State.
(b) Determination.--Upon receipt of a plan submitted by a State under
subsection (a), and after notice and an opportunity for public comment,
the appropriate Federal official shall promptly determine whether such
State's regulatory regime--
(1) in the case of offshore wells, establishes requirements
comparable to those applicable to covered wells under this Act,
or alternative requirements providing an equal or greater level
of safety as those applicable to covered wells under this Act;
and
(2) in the case of onshore wells, effectively protects public
health and safety and the environment.
(c) Opportunity to Remedy Deficiencies.--If the appropriate Federal
official determines that the State regulatory regime does not meet the
applicable standard under subsection (b), the appropriate Federal
official shall identify the deficiencies that are the basis for such
determination and provide a reasonable period of time for the State to
remedy the deficiencies.
(d) Ineffective Regulation.--If a State does not submit a plan
pursuant to subsection (a), or if the appropriate Federal official
determines that a State's regulatory regime does not meet the
applicable requirements under subsection (b) and the State does not
remedy the deficiencies, then such State shall be considered incapable
of effectively regulating such wells for purposes of section
17(10)(C)(iv).
(e) Lack of State Concurrence.--(1) In the event a State does not
concur in a determination under section 17(10)(C)(v) and the
appropriate Federal official disagrees with the failure of the State to
concur, the appropriate Federal official may decide to regulate wells
as covered wells under this Act notwithstanding section 17(10)(C)(v) if
the Federal official determines that the State's regulatory regime does
not effectively protect public health and safety and the environment.
If the State files a legal action under paragraph (2), the authority of
the appropriate Federal official to regulate wells as covered wells
under this subsection shall be stayed until the conclusion of the
litigation, including any appeals.
(2) A State may file an action in a Federal district court of
appropriate jurisdiction challenging a decision by the appropriate
Federal official to regulate wells as covered wells under this
subsection. The standard of review of the decision of the appropriate
Federal official shall be clear and convincing evidence.
(f) Wells on Federal or Tribal Lands.--In the case of a well on
Federal or tribal land, the appropriate Federal official shall
determine whether the combination of the Federal, State, and tribal
regulation applicable to such well effectively protects public health
and safety and the environment. If the appropriate Federal official
determines that the combination of Federal, State, and tribal
regulation does not effectively protect public health and safety and
the environment, then such well shall be considered not subject to
effective regulation for purposes of section 17(10)(D)(iv).
SEC. 16. SAVINGS CLAUSE.
Nothing in this Act shall be construed to preempt regulation by any
State or local government of oil and gas exploration and production
wells drilled in State waters, on State lands, or on private lands
within that State pursuant to the laws of that State or local
government.
SEC. 17. DEFINITIONS.
In this Act:
(1) Advisory committee.--The term ``Advisory Committee''
means the Well Control Technical Advisory Committee established
pursuant to section 6(a).
(2) Appropriate federal official.--The term ``appropriate
Federal official'' means the Secretary of Energy or Secretary
of the Interior, as designated for specific responsibilities
provided in this Act by the President of the United States.
(3) Blind shear ram.--The term ``blind shear ram'' means a
device capable of cutting through a drill pipe and sealing a
well.
(4) Blowout.--The term ``blowout'' means the uncontrolled
release of hydrocarbons or other materials from a well.
(5) Blowout preventer.--The term ``blowout preventer'' means
a wellhead device or combination of devices designed and
intended to prevent a blowout.
(6) Casing.--The term ``casing'' means any pipe permanently
installed, or intended to be permanently installed, in a well.
(7) Casing shear ram.--The term ``casing shear ram'' means a
device capable of cutting through casing.
(8) Cementing.--The term ``cementing'' means the practice of
forcing cement into the annular space between the casing and
the bore-hole or between any two pipes within the bore-hole to
prevent fluids or gases from finding a flow path through that
space.
(9) Cement bond log.--The term ``cement bond log'' means a
test conducted, using acoustic signals or such other technology
as the appropriate Federal official may designate that provides
results of equal or better quality, to determine the integrity
and completeness of a cementing job for a given well or segment
of a well by determining the extent to which the cement has
filled annular spaces and bonded to pipes and surrounding
formations.
(10) Covered well.--The term ``covered well'' means--
(A) an oil or gas exploration or production well that
is located on the outer Continental Shelf; or
(B) an offshore oil or gas exploration or production
well that--
(i) is not located on Federal or tribal land;
(ii) is not a marginal well;
(iii) based on criteria established by rule
by the appropriate Federal official, could, in
the event of a blowout, lead to extensive and
widespread harm to public health and safety or
the environment; and
(iv) is located in a State that the
appropriate Federal official determines under
section 15(d) cannot effectively regulate the
well; or
(C) an onshore oil or gas exploration or production
well--
(i) that is not located on Federal land;
(ii) that is not a marginal well;
(iii) that, based on criteria established by
rule by the apprpriate Federal official, could,
in the event of a blowout, lead to extensive
and widespread harm to public health and safety
or the environment;
(iv) that is located in a State that the
appropriate Federal official determines under
section 15 cannot effectively regulate the
well; and
(v) with respect to which the State concurs
in the determination referred to in clause
(iv); or
(D) an oil or gas exploration or production well
that--
(i) is located on Federal or tribal land;
(ii) is not a marginal well;
(iii) based on criteria established by rule
by the appropriate Federal official, could, in
the event of a blowout, lead to extensive and
widespread harm to public health and safety or
the environment; and
(iv) is determined by the appropriate Federal
official under section 15(f) to be not subject
to effective regulation.
(11) Exploration well.--The term ``exploration well'' means a
well intended to determine whether economically recoverable
oil, natural gas, natural gas liquids, or other hydrocarbons
exist in the geological deposits or strata to or through which
the well is drilled.
(12) Flow path.--The term ``flow path'' means a potential
route by which hydrocarbons or other materials could migrate
within a well.
(13) Lockdown device.--The term ``lockdown device'' means a
device at the top of the wellbore designed to prevent upward
movement of casing after installation.
(14) Marginal well.--The term ``marginal well'' means a
production well that produces no more than 10 barrels of oil
and no more than 60,000 cubic feet of natural gas per day.
(15) Operator.--The term ``operator'' means, with respect to
a covered well, the owner or lessee of the rights to explore
for, or produce oil or gas through such well.
(16) Outer continental shelf.--The term ``outer Continental
Shelf'' means all submerged lands lying seaward and outside of
the area of lands beneath navigable waters as defined in
section 2 of the Submerged Lands Act (43 U.S.C. 1301), and of
which the subsoil and seabed appertain to the United States and
are subject to its jurisdiction and control.
(17) Pressure testing.--The term ``pressure testing'' means
testing under conditions of elevated hydrostatic pressure
generated by natural or artificial means to determine well
integrity, the effectiveness of cementing, or the effectiveness
of equipment used in the well or to drill the well.
(18) Production well.--The term ``production well'' means a
well which is being drilled to allow the production of oil,
natural gas, natural gas liquids, or other hydrocarbons.
(19) ROV.--The term ``ROV'' is an acronym for Remotely
Operated Vehicle, and means an unmanned, remotely operated,
submersible device that is capable of relaying images or
information, manipulating or operating various elements of a
blowout preventer or other equipment on the seabed, or
performing other subsea functions.
(20) Subsea blowout preventer.--The term ``subsea blowout
preventer'' means a blowout preventer installed on an offshore
well below the surface of the water.
(21) System integration test.--The term ``system integration
test'' means a test of the various elements of a blowout
preventer, equipment associated with the use of such preventer,
and the controls of the blowout preventer, as combined and
configured for operation.
(22) Well control event.--The term ``well control event''
means a blowout or any event that threatens, if not controlled,
to result in a blowout.
SEC. 18. STUDY ON RELIEF WELLS.
Not later than 60 days after the date of enactment of this Act, the
appropriate Federal official shall enter into an arrangement with the
National Academy of Engineering under which the Academy shall, not
later than 1 year after such arrangement is entered into, submit to the
appropriate Federal official and to Congress a report that assesses the
economic, safety, and environmental impacts of requiring that 1 or more
relief wells be drilled in tandem with the drilling of some or all
covered wells subject to the requirements of this Act.
SEC. 19. REPORT ON PENDING FEDERAL DRILLING APPLICATIONS.
Within 30 days after the date of enactment of this Act, the
appropriate Federal official shall report to Congress on the status of
all pending Federal drilling and drilling-related applications and
permits, the amount of time that these applications and permits have
been pending, and any reasons for delay in approval.
Purpose and Summary
H.R. 5626, the ``Blowout Prevention Act of 2010'', was
introduced by Reps. Henry A. Waxman (D-CA), Edward J. Markey
(D-MA), and Bart Stupak (D-MI) on June 29, 2010. The purpose of
H.R. 5626 is to protect public health and safety and the
environment by requiring the use of safe well control
technologies and drilling practices for covered oil and gas
exploration and production wells.
Background and Need for Legislation
On April 20, 2010, at about 10 p.m., an explosion occurred
on the Deepwater Horizon oil drilling rig, which was drilling a
well in BP's Macondo Prospect, approximately 40 miles south of
the Louisiana coast in the Gulf of Mexico. There were 126
people on the rig at the time of the explosion. Fifteen of
those were injured and 11 died. The Coast Guard responded to
the explosion and fire, which caused the rig to sink and
resulted in the ongoing blowout.
In the wake of this tragedy, serious questions have been
raised about the causes of the explosion and the adequacy of
industry practices and regulatory standards relating to oil and
gas drilling. Ongoing investigations are being conducted by a
Marine Board of Investigation (a joint effort under the Coast
Guard and the Department of the Interior (DOI)), a Presidential
Commission, the U.S. Chemical Safety and Hazard Investigation
Board, and several congressional committees, including the
Committee on Energy and Commerce.
The Subcommittee on Oversight and Investigations of the
Committee on Energy and Commerce held three hearings on the
explosion and blowout.\1\ The Subcommittee's investigation
revealed that BP appears to have made numerous key decisions
that increased the risk of a well control problem and may have
contributed to the Deepwater Horizon disaster.\2\ Based on that
investigation, it appears that the following occurred: BP chose
a well design that had only two barriers to prevent flow of
dangerous gases instead of using a design that had multiple
barriers; BP ignored the advice of its contractor, Halliburton,
and chose a cement sealing approach for the well that was
predicted to fail; BP failed to conduct a key test to evaluate
the sufficiency of the cementing job; BP failed to fully
circulate well fluids to facilitate better cementing; and BP
did not install a key piece of equipment at the wellhead prior
to the explosion. Several of these steps, though considered to
be industry best practices, are not mandated under current law.
All of these decisions appear to have saved time and money for
BP, but increased risks.
---------------------------------------------------------------------------
\1\Subcommittee on Oversight and Investigations, Hearing on Inquiry
into the Gulf Coast Oil Spill (May 12, 2010); Hearing on Local Impact
of the Deepwater Horizon Oil Spill (June 7, 2010); Hearing on the Role
of BP in the Deepwater Horizon Explosion and Oil Spill (June 17, 2010).
\2\Letter from Reps. Henry A. Waxman and Bart Stupak to Tony
Hayward, Chief Executive Officer of BP (June 14, 2010).
---------------------------------------------------------------------------
Well Control Issues
Perhaps the most critical safety issue with regard to oil
and gas drilling is the maintenance of ``well control''--i.e.
control over conditions in the well bore, where high pressures
threaten to drive oil and gas toward the surface from
subsurface formations. If these pressurized hydrocarbons cannot
be controlled, they may reach the surface and cause a fire or
explosion. On the Deepwater Horizon, an uncontrolled influx of
gas into the well is believed to have caused an uncontrolled
``blowout'' and the ensuing explosion.
Current drilling technology uses a number of lines of
defense to prevent the loss of well control: (1) the
circulation of heavy drilling ``mud'' through the well, which
helps to equalize pressure and prevent uncontrolled upward flow
of hydrocarbons; (2) the use of cement and mechanical barriers
in and around steel casing (which lines the well and forms the
conduit between the hydrocarbon reservoir and the surface)
preventing unintentional upward flow of oil and gas. During
drilling operations, wells are equipped with a blowout
preventer, which includes a series of devices for use to assist
in regaining control of the well during a well control event
threatening a blowout and to shut in the wellbore in a blowout
or in other emergencies.
Blowout Preventers
A blowout preventer is a piece of equipment installed at
the wellhead and designed to prevent an uncontrolled release of
hydrocarbons from a well. It consists of several independent
systems that may be used to ensure well control, which may
include:
--Annular Preventers, which seal the wellbore with a
variable-width rubber aperture that can close on itself
or around any pipe that may be strung through the
wellbore;
--Variable Bore Rams, which seal around drill pipe
with rubber-tipped steel blocks;
--Blind Shear Rams, the well-control mechanism of
last resort, designed to cut through drill pipe and
seal the well during an emergency; and
--``Casing'' or ``Super'' Shear Rams, which are
designed to cut through casing or other obstructions
that may be present in the wellbore, allowing blind
shear rams to close and seal the well during an
emergency.
Because the blowout preventer is intended to provide a
failsafe last-resort well control and shut in capability that
must function in an emergency, blowout preventers are often
designed with redundant equipment and control systems, to
ensure that at least one set of emergency systems is always
functional. In numerous cases, however, blowout preventers have
failed to operate. The blowout preventer installed on the
Macondo well failed to control the blowout.
The Committee identified several potential problems that
might have resulted in this failure. According to a 2004 report
commissioned by the Minerals Management Service, blind shear
rams are not designed to cut through drill pipe tool joints,
the thick-walled connections between sections of pipe.\3\
Casing shear rams also may not cut through tool joints. These
tool joints may take up as much as 10% of a pipe's length. The
use of redundant shear rams could eliminate this risk, ensuring
that there is always one shear ram that is not opposite a tool
joint. But DOI regulations currently do not require redundant
blind shear rams and casing shear rams. The Deepwater Horizon
included only one of each of these rams.
---------------------------------------------------------------------------
\3\West Engineering Services, Shear Ram Capabilities Study (Sept.
2004) (online at http://www.mms.gov/tarprojects/463/
%28463%29%20West%20Engineering%20Final%20Report.pdf).
---------------------------------------------------------------------------
Blowout preventers usually include one or more emergency
backup (or secondary control) systems, including a system
commonly called a ``deadman switch,'' to close the blind shear
rams and seal the well in case of a loss of communication with
the drilling rig. In order for the deadman switch on the
Deepwater Horizon to be activated, three separate lines from
the rig to the blowout preventer had to be severed: power,
communication, and hydraulics. If any one of those lines
remained active, the deadman switch would not have been
triggered even though the blind shear rams could not be
activated from the surface. The Deepwater Horizon also did not
have an acoustic backup switch, which might have been able to
activate the blowout preventer remotely from the surface.
Offshore drilling operators rely on remote-operated
vehicles (ROV) to activate blowout preventers as a last resort.
These unmanned, submersible vehicles travel to the bottom of
the ocean and can directly trigger blowout preventers via an
interface on the blowout preventer. The Deepwater Horizon's
blowout preventer, however, never sealed the well even after
many days of ROV intervention.
The Committee also learned that there were several issues
with the Deepwater Horizon's maintenance of its blowout
preventer system. There are no DOI regulations requiring
testing of emergency systems, and BP did not conduct such
tests. ROVs discovered several leaks in the hydraulic lines
that provide pressure for blowout preventer functions, and
found unexpected modifications to the original design of the
blowout preventer. These problems resulted in wasted time in
the critical days following the accident and might have
contributed to the initial failure of the blowout preventer.
Well Design, Fluid Circulation and Displacement, and Cementing
Practices
The Committee's investigation also uncovered several issues
concerning decisions BP made in regard to the design and
execution of the Macondo well plan.
The Macondo well was designed with a ``long string''
production casing that extended from the sea floor down to the
reservoir from which oil was to be produced. This well design
left only two barriers along one flow path through which
hydrocarbons could flow between the reservoir and the blowout
preventer: a layer of cement at the bottom of the well, and a
mechanical seal at the wellhead itself. Another design, a
``liner-tieback'' approach, would have made a blowout less
likely by incorporating four barriers between the reservoir and
the blowout preventer: two mechanical seals and two layers of
cement.
Installing a ``lockdown sleeve'' on the mechanical seal at
the wellhead would have reinforced the wellhead against
pressure from below as well as pressure from above. This
lockdown sleeve was never installed on the Macondo well, even
though drillers on the Deepwater Horizon began procedures that
would have put upward pressure on the wellhead seal.
Because the Macondo well was designed with a long string
casing, it was critically important that the cement job at the
bottom of the well successfully seal off the reservoir. But
there were several issues concerning BP's final cement job: BP
ran casing with fewer ``centralizers'' than its cementing
contractor predicted would be sufficient to ensure an even seal
around the entire casing; it failed to circulate drilling mud
throughout the well before cementing, in accordance with
industry best practices; and it failed to run a cement bond log
test, which could have uncovered failures or imperfections in
the bonded cement.
DOI Actions
In addition to the investigations referenced above, the
President ordered the Secretary of the Interior to review the
accident and propose additional precautions and technologies
that should be required to improve the safety of offshore oil
and gas drilling. The findings of this review were published on
May 27, 2010, in a document commonly referred to as the
Department of Interior's ``30-day Report.''\4\
---------------------------------------------------------------------------
\4\Department of the Interior, Increased Safety Measures for Energy
Development on the Outer Continental Shelf (May 27, 2010) (online at
http://www.doi.gov/deepwaterhorizon/loader.cfm?csModule=security/
getfile&PageID=33598).
---------------------------------------------------------------------------
The 30-day report offered recommendations for improving
offshore drilling safety. DOI implements many of the
recommendations in a Notice to Lessees issued on June 8,
2010.\5\ The Notice to Lessees contained several new safety
requirements, including:
---------------------------------------------------------------------------
\5\Department of the Interior, National Notice to Lessees and
Operators of Federal Oil and Gas Leases, Outer Continental Shelf (June
8, 2010) (NTL No. 2010-N05) (online at http://www.doi.gov/
deepwaterhorizon/loader.cfm?csModule=security/getfile&PageID=34536).
---------------------------------------------------------------------------
Certification by the operator's chief
executive officers that the operator is in compliance
with applicable regulations;
Independent third-party inspection and
certification of blowout preventers;
Requirements for emergency blowout preventer
emergency shut-in systems;
Requirements that blowout preventers must be
capable of being operated by Remotely Operated
Vehicles;
Blowout preventer inspection and testing
after use during a well control event;
Verification that blowout preventer blind
shear rams can shear the drill pipe;
Requirements for a casing hanger lockdown
mechanism; and
Requirements for dual mechanical barriers in
addition to a cement barrier to prevent well flow
during installation of the final casing string.
Some of the longer-term recommendations of the 30-day
report were not included in the Notice to Lessees, including:
Mandatory redundant blind shear rams to
prevent failure if a drill pipe joint is across one
ram;
Requirements for documentation of blowout
preventer maintenance and repair;
Blowout preventer testing to ensure full
operability of all functions; and
Federal inspection of drilling rigs,
including in-person observation of tests on blowout
prevention equipment.
Legislative History
H.R. 5626, the Blowout Prevention Act of 2010, was
introduced by Representatives Waxman, Markey, and Stupak on
June 29, 2010, and referred to the Committee on Natural
Resources, and in addition to the Committee on Energy and
Commerce. On June 30, 2010, H.R. 5626 was referred to the
Subcommittee on Energy and Environment, which held a
legislative hearing on the bill the same day. H.R. 5626 was
subsequently considered by the full Committee without markup in
Subcommittee.
Committee Consideration
On July 15, 2010, the Committee on Energy and Commerce met
in open markup session to consider H.R. 5626. A manager's
amendment in the form of an amendment in the nature of a
substitute was offered by Mr. Waxman. The Committee adopted
several amendments to the manager's amendment by voice vote,
and then agreed to the amendment in the nature of a substitute,
as amended, by a voice vote. Subsequently, the Committee
ordered H.R. 5626 favorably reported to the House, amended, by
a record vote of 48-0 (1 member voting ``present'').
Committee Votes
Clause 3(b) of rule XIII of the Rules of the House of
Representatives requires the Committee to list each record vote
on the motion to report legislation and amendments thereto. A
motion by Mr. Waxman ordering H.R. 5652 reported to the House,
amended, was approved by a record vote of 48 yeas and 0 nays (1
member voting ``present''). The following is the record vote
taken during Committee consideration, including the names of
those members voting for and against:
Committee Oversight Findings and Recommendations
In compliance with clause 3(c)(1) of rule XIII of the Rules
of the House of Representatives, the findings and
recommendations of the Committee are reflected in the
descriptive portions of this report.
New Budget Authority, Entitlement Authority, and Tax Expenditures
Regarding compliance with clause 3(c)(2) of rule XIII of
the Rules of the House of Representatives, the Committee will
rely on the estimate prepared by the Director of the
Congressional Budget Office pursuant to section 402 of the
Congressional Budget Act of 1974, which at the time of the
filing of this report had not been completed.
Statement of General Performance Goals and Objectives
Clause 3(c)(4) of rule XIII of the Rules of the House of
Representatives does not apply to H.R. 5626 as the bill does
not authorize funding.
Constitutional Authority Statement
Pursuant to clause 3(d)(1) of rule XIII of the Rules of the
House of Representatives, the Committee finds that the
constitutional authority for H.R. 5626 is provided in Article
I, section 8, clauses 3 and 18.
Earmarks and Tax and Tariff Benefits
H.R. 5626 does not contain any congressional earmarks,
limited tax benefits, or limited tariff benefits as defined in
clause 9 of rule XXI of the Rules of the House of
Representatives.
Federal Advisory Committee Statement
The Committee finds that the legislation establishes or
authorizes the establishment of an advisory committee within
the meaning of section 5 U.S.C. App., 5(b) of the Federal
Advisory Committee Act. Section 6 of H.R. 5626 as ordered
reported by the Committee provides for the creation of a Well
Control Technical Advisory Committee. The Committee finds that
this advisory committee is needed to assess blowout preventer
and well control technologies, practices, voluntary standards,
and regulations in the United States and elsewhere, to assess
whether existing standards adequately protect public health and
safety and the environment, and, as appropriate, to recommend
modifications to existing regulations.
Applicability of Law to the Legislative Branch
The Committee finds that H.R. 5626 does not relate to the
terms and conditions of employment or access to public services
or accommodations within the meaning of section 102(b)(3) of
the Congressional Accountability Act of 1985.
Federal Mandates Statement
Regarding the requirements of section 423 of the
Congressional Budget and Impoundment Control Act of 1974 (as
amended by section 101(a)(2) of the Unfunded Mandates Reform
Act, P.L. 104-4), the Committee will rely on the analysis
prepared by the Director of the Congressional Budget Office,
which at the time of the filing of this report had not been
completed.
Committee Cost Estimate
Pursuant to clause 3(d) of rule XIII of the Rules of the
House of Representatives, the Committee will adopt as its own
the cost estimate on H.R. 5626 prepared by the Director of the
Congressional Budget Office pursuant to section 402 of the
Congressional Budget Act. At the time of the filing of this
report, this estimate had not been completed.
Congressional Budget Office Cost Estimate
With respect to the requirements of clause (3)(c)(3) of
rule XIII of the Rules of the House of Representatives and
section 402 of the Congressional Budget Act of 1974, the
Committee has not yet received a cost estimate for H.R. 5626
from the Director of the Congressional Budget Office.
Section-by-Section Analysis of the Legislation
Section 1. Short title
This section provides that the Act may be cited as the
``Blowout Prevention Act of 2010''.
Section 2. No drilling of covered wells without demonstrated ability to
prevent and contain leaks
Subsection (a) provides that, effective one year after the
date of enactment, a federal permit to drill a covered well
shall not be issued unless the applicant demonstrates, the CEO
of applicant attests, and the appropriate federal official (the
Secretary of the Interior or Secretary of Energy, as determined
by the President) determines that (1) the well design is safe;
(2) the blowout preventer has redundant systems to prevent or
stop a blowout for all foreseeable blowout scenarios and
failure modes; (3) the applicant has an oil spill response plan
that ensures the applicant has the capacity to promptly control
and stop a blowout if the blowout preventer and other well
control measures fail, and (4) the applicant has the capacity
to begin drilling a relief well promptly and complete drilling
of a relief well expeditiously.
Subsection (b) requires an operator to meet the same
requirements as those in subsection (a) in order to obtain
federal approval to drill a covered well that does not
currently require a federal permit. This approval function can
be delegated to states.
Subsection (c) provides that a permit or approval issued
under this section shall require the operator to seek a
revision of such permit or approval in the event of a material
modification to the well design, blowout preventer, plan to
promptly stop a blowout, or capability to begin or complete
drilling of a relief well for such covered well.
Section 3. Blowout preventer requirements
Subsection (a) requires the appropriate federal official to
issue regulations to require the use of a blowout preventer for
a covered well and to prescribe safety standards that require
that the blowout preventer will operate effectively at the
location it will be deployed. At a minimum, the regulations
must include the following requirements: (1) two sets of blind
shear rams appropriately spaced to prevent blowout preventer
failure if a drill pipe joint or drill tool is across one set
of blind shear rams during a situation that threatens loss of
well control; (2) redundant emergency backup control systems
capable of activating the blowout preventer when the rig, or
critical links between the rig and the blowout preventer, are
destroyed or inoperable; (3) regular testing of the emergency
backup control systems, including testing during deployment;
and (4) as appropriate, remotely operated vehicle intervention
capabilities for secondary control, including adequate
hydraulic capacity to activate blind shear rams, casing shear
rams, and other critical blowout preventer components.
This section also requires studies and recommendations by
the Well Control Technical Advisory Committee (established
under section 6) regarding (1) whether the use of up to two
sets of casing shear rams would improve the safety of blowout
preventer systems at covered wells; (2) the risks associated
with the failure of hydraulic and activation systems for the
blind shear rams and other critical blowout preventer
components and the need for redundancy in blowout preventer
components; and (3) the risk associated with non-subsea blowout
preventers at offshore wells in the event the drilling rig for
such well is damaged or destroyed, the riser or other well
component between the wellbore and the blowout preventer is
damaged or destroyed, or the blowout preventer is rendered
inoperative. If, based on any recommendation of the Advisory
Committee resulting from these studies, the appropriate federal
official determines that safety would be significantly improved
by requiring additional measures to mitigate risks, the
appropriate federal official shall include such requirements in
the regulations issued under the Act.
If the appropriate federal official determines that one of
the minimum requirements under this section would be less
effective than an alternative technology or practice for all
covered wells, or for one or more classes of covered wells, the
alternative technology or practice may instead be required.
Subsection (b) requires independent third-party
certification of a blowout preventer prior to drilling a
covered well. The certification is based on a detailed physical
inspection, design review, system integration test, and
function and pressure testing. The certification ensures, based
on the third-party certifier's best professional judgment, that
(1) the blowout preventer is properly designed for and will
operate effectively for the drilling conditions, and with the
equipment, well design, and location where it will be
installed; (2) blind shear rams and casing shear rams will
function effectively and cut the drill pipe or casing; (3)
emergency control systems will function effectively; and (4)
the blowout preventer has not been compromised or damaged from
prior service. Recertification is required every 180 days or
after any material modification to the blowout preventer or
design of the well.
Subsection (c) requires prompt function and pressure
testing of a blowout preventer at a covered well after a
significant well control event to ensure full operability of
all blowout preventer functions.
Subsection (d) includes reporting requirements for blowout
preventer maintenance and repair, electronic logs, design
specifications, changes to design specifications, and failure
during a well control event.
Section 4. Ensuring safe wells and cementing
Subsection (a) requires regulations to ensure the
appropriate and safe design of covered wells. The regulations
shall (1) in connection with installation of the final casing
string, require the installation of at least two independent,
tested mechanical barriers, in addition to a cement barrier,
across each flow path between hydrocarbon bearing formations
and the blowout preventer; (2) require that wells be designed
so that a failure of one barrier does not significantly
increase the likelihood of failure of another barrier; (3)
require that the casing design is appropriate for the intended
purpose under reasonably expected wellbore conditions; and (4)
require the installation and pressure testing of a lockdown
device at the time casing is installed in the wellhead.
Subsection (b) requires regulations for cementing programs
of covered wells to ensure that well control will be maintained
and there will be no unintended flow of hydrocarbons. At a
minimum, the regulations shall require adequate centralization
of the casing, a full circulation of drilling fluids prior to
cementing, the use of adequate cement volume, and cement bond
logs for all cementing programs intended to provide a barrier
to hydrocarbon flow.
Subsection (c) requires the well operator to maintain a
team of experienced and highly qualified engineers and other
appropriate experts to advise the operator on the safety of
decisions made during drilling of the well.
Subsection (d) requires regulations to establish procedures
and technologies to be used to minimize the risk of ignition
and explosion of hydrocarbons or other materials discharged
from the well during a blowout or well control event.
Under subsection (e), if the appropriate federal official
determines that one of the minimum requirements under this
section would be less effective than an alternative technology
or practice for all covered wells, or for one or more classes
of covered wells, the alternative technology or practice may
instead be required.
Subsection (f) requires independent third-party
certification, prior to the commencement of drilling, that the
covered well meets the requirements of this section, and that,
in the independent third party's best professional judgment,
the operator's casing designs and cementing programs and
procedures ensure that well control will be maintained.
Recertification is required after any material modification of
the well design.
Section 5. Stop-work requirements
This section requires regulations to establish requirements
(1) for operators and contractors to stop non-safety-related
work when there are conditions indicating an immediate risk of
a blowout at a covered well and (2) that operators adopt
policies and procedures to promote a safety culture and to
ensure that non-safety-related work stops in circumstances that
present an immediate risk of a blowout.
Section 6. Independent technical advice and certification
Subsection (a) provides for the establishment of an
independent Well Control Technical Advisory Committee to review
and comment on proposed regulations, respond to requests for
advice from the appropriate federal official, provide reports
assessing implementation of this Act, and provide periodic
reports at least once every five years (1) assessing available
blowout preventer and well control technologies, practices,
voluntary standards, and regulations in the United States and
elsewhere, (2) assessing whether existing regulations are
adequate, and (3) recommending modifications to the
regulations. The Federal Advisory Committee Act (other than
section 14 of the Act) shall apply to the Advisory Committee.
Subsection (b) requires the appropriate federal official to
establish standards for the approval of independent third-party
certifiers. The appropriate federal official will contract
directly with the third-party certifiers and assign third-party
certifiers to individual certifications and recertifications.
The appropriate federal official shall ensure that a third-
party certifier is appropriately qualified for each
certification or recertification to which it is assigned and
that reviews, inspections, and tests are timely performed.
Operators shall pay fees to cover the costs of these
activities. It shall be a violation of this Act for any third-
party certifier to knowingly or recklessly make any false
statement in any document submitted in connection with a
certification or recertification.
Subsection (c) allows for the establishment of a panel of
independent technical experts to provide technical advice to
the appropriate federal official with regard to any well-
specific regulatory decision under this Act. Such experts may
be drawn from academia, national laboratories, industry, or
other sources.
Section 7. Regulations and orders
Subsection (a) requires the appropriate federal official to
issue the regulations required by this Act not later than 1
year after the date of enactment. At least once every 5 years,
the appropriate federal official shall review the regulations
and the recommendations of the Advisory Committee and revise
the regulations if they do not adequately protect public health
and safety and the environment.
Subsection (b) authorizes the appropriate federal official,
prior to the effective date of the initial regulations required
by this Act, to issue interim orders applicable to one or more
operators to require the operator to have the capacity to
prevent and respond to a blowout; use safe and effective
blowout preventers, casing designs, cementing programs and
procedures, and well designs; and use appropriate procedures
and technologies to minimize the risk of ignition or explosion
in the event of a blowout or well control event.
Section 8. Well control and blowout prevention inspectors
This section requires periodic unannounced inspections and
in-person observation of tests by federal inspectors, as well
as the charging of fees from operators to cover the associated
costs.
Section 9. Judicial review of regulations
This section provides for judicial review of regulations
issued by the appropriate federal official under this Act
exclusively in the U.S. Court of Appeals for the District of
Columbia Circuit. Any such petition for review shall be filed
within 60 days from the date notice of the issuance of the
regulation appears in the Federal Register, except that if the
petition is based solely on grounds arising after such sixtieth
day, then any such petition for review shall be filed within 60
days after such grounds arise.
Section 10. Investigations and information requests
This section provides for the investigation of alleged or
suspected violations of this Act and for the gathering of
information needed to implement this Act.
Section 11. Citizen suits
The section provides for citizen suits to compel compliance
with this Act.
Section 12. Remedies and penalties
This section provides for enforcements of the provisions of
this Act and regulations, orders, approvals under section 2(b),
and permits issued under this Act through (1) civil actions for
temporary restraining orders or injunctions, (2) civil
penalties for noncompliance, and (3) criminal penalties for
knowing and willful violations.
Section 13. Retaliation prohibited
This section prohibits retaliation against whistleblower
employees, including those who report violations of this Act or
refuse to participate in conduct that is not in compliance with
this Act.
Section 14. Chemical Safety Board investigation
This section amends the Clean Air Act to facilitate the
investigation of the Chemical Safety and Hazard Investigation
Board into the facts, circumstances, and causes of marine oil
spills resulting from accidental fire, explosion, or release
involving an offshore oil or gas exploration or production
facility.
Section 15. State and Federal regulation
This section relates to the determination of which wells
are covered wells subject to the requirements of this Act. It
allows any state to submit to the appropriate federal official
a plan demonstrating that the state's regulatory regime
provides effective regulation of oil or gas exploration or
production wells located in such state. In order to meet such
standard for offshore wells not located on the outer
Continental Shelf, the state must show that it has established
requirements comparable to those applicable to covered wells
under this Act, or alternative requirements providing an equal
or greater level of safety. In order to meet such standard for
onshore wells not located on federal or tribal land, the state
must show that it has established regulations applicable to
such wells to effectively protect public health and safety and
the environment. In the case of wells on federal or tribal
land, the appropriate federal official shall determine whether
the combination of the federal, state, and tribal regulation
applicable to such wells effectively protects public health and
safety and the environment.
If the appropriate federal official determines that a state
regulatory regime does not meet the applicable standard, the
appropriate federal official shall identify the deficiencies
that are the basis for such determination and provide a
reasonable period of time for the state to remedy the
deficiencies. In the event a state does not concur in the
appropriate federal official's finding that the state cannot
effectively regulate an onshore well not located on federal or
tribal land, the appropriate federal official may decide to
regulate such well as a covered well under this Act. The state
may file a legal action challenging such a decision. If the
state files such a legal action, the authority of the
appropriate federal official to regulate such wells as covered
wells shall be stayed until the conclusion of the litigation,
including any appeals. The judicial standard of review of the
decision of the appropriate federal official shall be a clear
and convincing evidence standard.
Section 16. Savings clause
This section provides that nothing in this Act shall be
construed to preempt state or local regulation of oil and gas
exploration and production wells drilled in state waters, on
state lands, or on private lands.
Section 17. Definitions
This section provides definitions of key terms in the Act.
A ``covered well'' is defined as: (A) an oil or gas
exploration or production well that is located on the Outer
Continental Shelf; or (B) an offshore oil or gas exploration or
production well that (1) is not located on federal or tribal
land; (2) is not a marginal well; (3) based on criteria
established by rule by the appropriate federal official, could,
in the event of a blowout, lead to extensive and widespread
harm to public health and safety or the environment; and (4) is
located in a state that the appropriate federal official
determines under section 15 cannot effectively regulate the
well; or (C) an onshore oil or gas exploration or production
well that (1) is not located on federal or tribal land; (2) is
not a marginal well; (3) based on criteria established by rule
by the appropriate federal official, could, in the event of a
blowout lead to extensive and widespread harm to public health
and safety or the environment; (4) is located in a state that
the appropriate federal official determines under section 15
cannot effectively regulate the well; and (5) with respect to
which the state concurs in the appropriate federal official's
finding that the state cannot effectively regulate the well; or
(D) an oil or gas exploration or production well that (1) is
located on federal or tribal land; (2) is not a marginal well;
(3) based on criteria established by rule by the appropriate
federal official, could, in the event of a blowout lead to
extensive and widespread harm to public health and safety or
the environment; and (4) is determined by the appropriate
federal official under section 15 to be not subject to
effective regulation.
The Committee intends that ``extensive and widespread
harm'' means large-scale and geographically widespread
ecological and economic harm of the magnitude caused by the
Santa Barbara, Exxon Valdez, Ixtoc, Montara, or Deepwater
Horizon spills. The Committee intends that ``tribal lands''
means land belonging to a federally recognized Indian tribe or
a member thereof that is held in trust by the United States, or
land held in fee by a federally recognized Indian tribe or a
member thereof, that is subject to the regulatory jurisdiction
of a federally recognized Indian tribe or of the federal
government with regard to oil or gas drilling operations.
A marginal well is defined as a production well that
produces no more than 10 barrels of oil and no more than 60,000
cubic feet of natural gas per day.
Section 18. Study on relief wells
Under this section, within 60 days of the date of enactment
of this Act, the appropriate federal official shall enter in an
arrangement with the National Academy of Engineering under
which the Academy shall, not later than 1 year after such
arrangement is entered into, submit to the appropriate federal
official and Congress a report that assesses the economic,
safety, and environmental impacts of requiring 1 or more relief
wells to be drilled in tandem with some or all covered wells.
It is the intent of the Committee that such study would include
an examination of the experience of other countries with
comparable requirements.
Section 19. Report on pending federal drilling applications
Under this section, within 30 days of enactment of this
Act, the appropriate federal official shall report to Congress
on the status of all pending federal drilling and drilling-
related applications and permits, the amount of time that these
applications and permits have been pending, and any reasons for
delay in approval.
Changes in Existing Law Made by the Bill, as Reported
In compliance with clause 3(e) of rule XIII of the Rules of
the House of Representatives, changes in existing law made by
the bill, as reported, are shown as follows (new matter is
printed in italic and existing law in which no change is
proposed is shown in roman):
CLEAN AIR ACT
* * * * * * *
TITLE I--AIR POLLUTION PREVENTION AND CONTROL
* * * * * * *
Part A--Air Quality and Emission Limitations
* * * * * * *
SEC. 112. HAZARDOUS AIR POLLUTANTS.
(a) * * *
* * * * * * *
(r) Prevention of Accidental Releases.--
(1) * * *
* * * * * * *
(6) Chemical safety board.--
(A) * * *
* * * * * * *
(T) Agreement.--Not later than 30 days after
the date of enactment of this subparagraph, the
Chemical Safety and Hazard Investigation Board,
the Coast Guard, and the Department of the
Interior shall enter into an agreement in order
to facilitate the Board's investigation of the
facts, circumstances, and causes of an
accidental fire, explosion, or release
involving an offshore oil or gas exploration or
production facility (regardless of whether
there is a resulting marine oil spill). Such
agreement shall provide the Board with the
following:
(i) Unrestricted access to any
personnel, records, witness statements,
recorded witness interviews, and
physical or documentary evidence
related to an offshore oil or gas
exploration or production facility
under investigation collected or
possessed by the Coast Guard or the
Department of the Interior.
(ii) The ability to conduct recorded
interviews of all agency personnel and
contractors and the right to obtain
records related to Federal regulatory,
inspection, enforcement, and safety
programs for offshore oil or gas
exploration and production.
(iii) The right to participate
equally in planning and executing any
testing of relevant items of physical
evidence related to the cause of the
accident.
(iv) Such support and facilities as
may be necessary for the Board's
investigation, including transportation
to the accident site, coastal waters
and affected areas, and other offshore
oil or gas exploration and production
facilities without cost to the Board.
(U) Recommendations.--Based on an
investigation of an accidental fire, explosion,
or release involving an offshore oil or gas
exploration or production facility, the Board
shall make recommendations with respect to
preventing subsequent accidental fires,
explosions, or releases to the Secretary of the
Interior and the Commandant of the Coast Guard.
The Secretary of the Interior and the
Commandant of the Coast Guard shall respond
formally and in writing to any recommendation
of the Board within 90 days of the receipt of
such recommendations.
* * * * * * *